Since October 2014, global financial stability risks have risen, and also rotated to parts of the financial system where they are harder to assess and to address. Risks have rotated away from banks to shadow banks, from solvency to market liquidity risks, and from advanced economies to emerging markets. Divergent growth and monetary policies across countries have increased tensions in global financial markets and caused rapid and volatile moves in exchange rates and interest rates. In part, this situation is a legacy of weakened and incomplete repair of private sector balance sheets. But other factors are at play as well. As risks are rising and rotating, additional policy measures—beyond monetary policies—are vital to make a durable exit from the global financial crisis and safeguard financial stability.

On May 6, the Global Economy and Development program at Brookings hosted a discussion on global financial stability based on the International Monetary Fund’s latest Global Financial Stability Report.

After a presentation by IMF Financial Counsellor José Viñals, a panel conversation was moderated by Brookings Vice President Kemal Dervis.